Effective Tax Planning: Strategies to Reduce Your Taxes feat. Steve Moskowitz

Hello, future billionaires. Welcome back to another episode of your favorite podcast, Invest Like a Billionaire. And today we're talking about your favorite topic that you didn't even know was your favorite topic, and that is taxes. But who thought you'd get so excited about taxes? Well, when you hear some of the strategies that our guest today, Steve Moskowitz, is talking about, you get very excited because his approach to taxes is how to pay zero taxes. So he's been doing this for a long time and he actually used to be a radio host, I think, for 30 years. So it's, it's kind of funny hearing him actually made it interesting, right? It was, you know, it's like listening to a dentist, you know, who wants to do that? But no, it wasn't like that. It was great. And I tell you, there's— it's worthwhile to spend time listening to guys like this and figure out how to put your, put your plan in place. Yeah. And I make the point later in the episode, but we spent so much time trying to make money. We don't spend as much time learning how to grow that money, but we spend probably even less time learning how to pay less taxes on the earnings. Right. And that is a huge needle mover in your, in your wealth growth plan. So you need to pay attention. You need to be looking into these things. So definitely don't want to miss this episode. You're going to enjoy it. Here you go. This is the Invest Like a Billionaire podcast where we uncover the alternative investments and strategies that billionaires use to grow wealth. The tools and tactics you'll learn from this podcast will make you a better investor and help you build legacy wealth. Join us as we dive into the world of alternative investments, uncover strategies of the ultra-wealthy, discuss economics, and interview successful investors. Looking for passive investments done for you? With Aspen Funds, we help accredited investors that are looking for higher yields and diversification from the stock market. As a passive investor, we do all the work for you, making sure your money is working hard for you in alternative investments. In fact, our team invests alongside you in every deal, so our interests are aligned. We focus on macro-driven alternative investments so your portfolio is best positioned for this economic environment. Get started and download your free economic report today. Hello, welcome back to the Invest Like a Billionaire podcast. I am your co-host Ben Frazier, joined by fellow co-host Bob Fraser. And today we're joined by Steve Moskowitz, um, and we're super excited to be talking about tax planning. I know this is the episode you've been waiting for for a long time, and we brought the expert out today. So, Steve, welcome. Steve, thanks for coming on the podcast, guys.

Thanks so very much. I'm going to have a good time because I love talking about tax planning. And you know, I get that's the reaction I get. People laugh, haha, tax attorneys joking around already, but I really mean it. And I was telling you before the broadcast why I became a tax attorney. So let's share that with the audience, give you some idea of what I feel. When I set foot into law school as a student many moons ago, I already had a master's degree in accounting, a bachelor's degree in accounting. I was a practicing CPA working for a big firm whose clients were the Fortune 500. I was boggled when I saw these Fortune 500 companies making all this money and legally not paying any taxes. And I said, I want to learn the secret. And that's why I went to law school, not to do divorces, chase ambulances, get murderers off the hook, but to do taxes. And I learned the secret and here's what it is. And I'll share it with your audience. There's two purposes to our tax law. One everybody knows about— get money out of us. But the other one is it's a system of incentives. And what happens with a system of incentives is how does the government get you to do something when in a democracy they don't have the right to order us to do anything? So how do they get us to do something they want us to do? Put it to the economy. Easy. They pay us. They pay us through the form of tax savings. And you say, well, oh, okay, where are all these tax savings? They're hidden in the tax law. And the way I explain this to new clients is I call it magic business card. If I said I have a magic business card, I'm going to hand it to you. And if you walk this over to the nearest IRS office, they'll give you a check for $1 million. I think most people say, I'll go right now. But suppose instead of just handing you the one card, I rented a big dump truck and I put the card in the dump truck and I took all regular business cards I dumped them in there. I took an oar, I stirred it up, and then I dumped all the business cards in your office. You'd walk in your office and say, oh my God, some vandal's been here. And you'd pay some janitorial company to haul them all away. And what you would be doing was throwing away the magic business card that would've paid you a million dollars because you just didn't know it was there. If you understand that concept, you understand this. And another thing I say to new clients is, so what do you think? Do you think you make more or less than Apple Computer? We all laugh. Haha. I make less than Apple Computer. And I said, but guess what? You pay more taxes than me. Then the laughing stops and they get serious. We're talking about tax planning. With most people, the tax return preparation, and yes, we do that too. And before I was a tax attorney, I was a CPA. We do tax return preparation, but a lot of people, tax return preparation is a once-a-year ordeal. And they say, oh, good, I'm glad that's over with for another year. I don't have to think about it. Wrong. The tax return. Should only be a mere summarization of a year's worth of tax planning. That's what the big companies do. And when Tim Cook took over Apple, that's one of the things he was amazed how much time he spends with Apple's tax lawyers so that they don't pay the taxes that the, the mom-and-pop stores, the small business, the medium-sized business are paying. And that's one of the major things we're about. And the government has so very much for us. And another thing that's been helping our clients is the ERC program, Employee Retention Credit. This is where the federal government is giving away— that's right, giving away. They're not making a loan. They're giving you money. It's a grant. It's a gift. Up to $26,000 for every employee that you had during 2020 and '21. So if you had 10 qualified employees, That would be just over a quarter, up to just over a quarter million bucks. If you had 20 employees that qualified, just up to over half a million bucks and so on. So you say, this is terrific. How do I get my free money? There's two ways to qualify, what I call the easy way and the not easy way. The easy way is, did your gross revenue drop by a certain amount? And what the amount is, if you compare quarters 1, 2, and 3, of 2021 with the same quarters for 2019, then you had— if you had a drop of 20% or more, that qualifies you. And that's just gross revenue. You have PPP, you exclude it, or loans or transfers, just gross revenue. So they say, okay, what if you had it in some quarters but not the others? To give you an idea, the government wants to give away the money so badly They actually amended the law and put in something that's known as an extender. So suppose you qualify for quarter 1, but you don't qualify for quarter 2. Quarter— that quarter that you qualify for qualifies you for that quarter and the next quarter. So they're just giving this money away. You take a look at it and you say, well, Steve, you said quarters 1, 2, and 3. What about quarter 4 of 2021. The only one that can do Q4 is startup businesses. What's a startup business? It's a startup business that started on February 15th, 2020, or thereafter and has an annualized gross revenue under $1 million. So if you're a startup business, it's even easier and you get an extra quarter. For 2020, it has to be 50% or less. You know what I've seen in practice? So many firms and so many CPAs say, well, if your gross revenue didn't go down, that's it, too bad, no ERC. Wrong. That's not what the law says. The law says either or, either that method, that easy objective method, because it's math, 1 1 2, that's it. But if you don't qualify into the math, there's a facts and circumstances, sometimes known as a full or partial closure test. What's that all about? If COVID restrictions had an adverse effect on your business for more than a nominal amount, you can still qualify. The IRS defines nominal at 10%. So suppose we had this situation. Suppose that in our base year we had $100,000 gross revenue. And let's say in 2019 we had $100,000 gross revenue and in 2021 we had $1 million, 10 times more. Could I still qualify? Yes. Because if you say, well, all right, if it hadn't been for COVID restrictions, instead of having $1 million, I would have had $1.3 million. And that extra $300,000 was way more than 10%. So that's another way to qualify. So why isn't everybody doing this? Because it takes a lot of work on the part of the professional. And you know, I, I talked to some of my colleagues just privately. They don't want to be bothered because they're, they're mass-producing ERC. And then with the math, 1 1 2, that's so easy. Either you're down that number or you're not. And if you are, go ahead and do it. And if you're not, next client. This one requires some work and thought. And what's some examples of those? Suppose we have supply chain problems. Suppose you're a baker and normally you buy 100 pounds of sugar a week and you say, you know what, the supply chain problems. I normally use C&H sugar, but I try to get any sugar, C&H, ABC, XYZ. I couldn't get my normal sugar amount. I could only get 30 pounds instead of my usual 100 pounds. So I had to bake a lot less cakes and a lot less cakes result in less revenue by 10% or more. Another thing that the companies saw, there was a spike in the cost. So a lot of companies had to raise their prices to cover costs. So the gross revenue was more, but it was just to cover these costs. But that doesn't matter. Did these restrictions, the example I used with supply chain, did that go ahead and cause you to lose more than 10% of business you otherwise would've had? If it does, that can qualify you. Now, other things you take a look at. Suppose you're in the construction trades and normally you install bathrooms in new houses, but now you can't get the fixtures. You can't get the sinks, you can't get the showers, you can't get the commodes. And the general contractor says, look, I have a contract with Bill. If you can't put in these bathrooms, I'll have to go to somebody that does. Or you install hot water heaters and people say, look, I'm not going to wait until your hot water heater comes in and take a hot shower. I'll find somebody that has it. Or other things. You're a farmer and you plant tomatoes. And normally before COVID all your workers would stand literally shoulder to shoulder and bend down, plant the tomatoes. But now you have the 6-foot spacing requirements, social distancing. So now what happens is you have to spread out your workers in your field and you have to plant less tomatoes because of that. You plant less tomatoes, you sell less tomatoes. And if your gross revenue is down by that more than 10%, that you otherwise would have had, you can qualify. Now, don't be confused. The gross revenue test is actual factual. You look at your actual numbers and take a look at that's the 20% and the 50%. This test we're saying, but for these COVID restrictions, I would have had more gross revenue and it would have been—

I've lost more than I could have even got. Gone up. Yeah. So I want to take a quick, quick step back, Steve, because I think some of the points you made are really important because You know, as we sit right now, we're kind of mid-April. We're talking, you know, this, this episode right now. And if people just filed their taxes, so taxes are on the forefront of everyone's minds and maybe they did it all. Or that's how it works. You would hope so, right?

For you, it definitely is.

But, you know, I got, I got several questions from investors and these different groups and things like, oh man, my friend, you know, made all this money last year and what can they do now to reduce their taxes? And it's Like, not much, actually nothing. Well, maybe one thing too.

Let's, let's talk about that with tax planning. Here it is, it's April 19th, 2023, and you say, you know, I saw you on that podcast and you're the kind of guy I want to do tax planning, and I know I have to write the check to save on '22 by December 31st, '22, and here it's '23, so I guess we'll do all this stuff for next year, right? I said, well, wait a minute. Let's talk about— I use the term pension plans. There's a technical difference between pension plans and retirement accounts, but I'm going to use them interchangeably for our purpose today. There's over 20 different types of these. You know, with a lot of them you have up to the time of filing the return plus extension to set it up, fund it. So in English, that means you have about three-quarters of the way into year 2. So here it is. April 19th, '23, you have basically another almost half a year to set up the plan, fund it, and then decide if you want it to apply to 2022. And if it, if you do, we can do something today in 2023 to save us taxes for 2022.

And this would be contributions to an IRA or a Roth or something. Is that what you're talking about?

Or that's one type, but okay. The problem— and you can have multiple plans. You can have those plans and those plans are fine, but we deal with the fancy plans like the cash benefit plans because we have clients that put away hundreds of thousands of dollars each year. And what happens is with these, we do an actuarial computation based on profits, the wages, the length of service, the age of the person, and we can get some big numbers in here. And basically, you know, I say to clients, okay, would you prefer to write a big check to the IRS or a smaller check to the IRS and a nice fat check to yourself for your retirement? That doesn't usually take too long to figure out. And then what if the kids are working for the business? If you pay the kids fair market value for services actually performed, then the kids can have a pension too. And also the kids' wages The kids get a brand new tax bracket, and that means for families, they pay less taxes that way. So instead of paying for the kid's college education, the kid pays for it because you save money in taxes. Not to mention learning the work ethic. So there's so much involved here.

You guys pause real quick. So what you're saying, because I know I'm familiar with paying kids to work for your business. Can that be done retroactively as well? Like my contributions to, to a plan or to a 401?

No, no. What happens is they split up wages and—

Okay.

Well, that one you got to do. Like I said, most things you have to do it before the year ends.

Yeah. Okay. Well, here it is.

It's April already. Before you know it, this year will be over. Go ahead and— but remember, you're not putting the kids just on the books. You're paying them fair market value for services actually performed.

Hmm. Yeah, I think— I mean, a point you're kind of making here is, and I think where a lot of people struggle with taxes is, is they don't think about it until, you know, March 15th.

What I always talked about is March Madness. And I say, I'm not talking about college basketball. I'm talking about— that's when businesses are saying, hey, I'm paying way too much and these big companies don't pay. And what's the secret? And they're angry about it. March Madness shouldn't be March Madness, should be tax planning. And let's talk about some other things with that. Buildings are very commonly used in business. You can be a landlord or you can practice in a building if you're a doctor or a lawyer, or you can be a business person with a factory in a building. So if you buy a building, regardless of how you pay for it, whether it's cash or finance, you have to depreciate it over a period of time. So if it's a residential building, we depreciate over 27.5 years. If it's commercial, 39 years. Well, wait a minute. Let's talk about time value of money. That's how the banks make money. How do we go ahead and benefit from them? Well, we know a benefit today is better than a benefit tomorrow. Obviously, you'd rather have a benefit today than you would 39 years from today. So we do something called cost segregation analysis. We send an engineer to the building and he or she inspects the building and says, well, okay, this part's 27.5 or 39-year property. This part's 15-year property, this part's 10-year property, this part's 5-year property, and this part we can write the whole thing off this year. So you have a much larger depreciation deduction. Let's have an example. Let's assume Sally is a, is a brain surgeon and she has a medical practice and she practices in the building that she owns. And she also is a landlord with other doctors in the building. And let's assume that for the year Sally has a gross revenue of $10 million and she has expenses, including regular depreciation, of $9 million. So she's made a profit of $1 million and she's going to have to pay tax on that. She says, well, wait a minute, what's this cost seg stuff? So let's assume that we go in and we have the cost seg and we say, well, wait a minute, we can have an extra $1.5 million of depreciation. So now we go ahead and apply that to her building. And even though she made a profit of $1 million, now she doesn't have to pay any taxes on the building because we've wiped that out with depreciation. And remember, depreciation— we don't write a check for depreciation. It's just an accounting entry, theoretical entry, depreciation. Now, guys, when somebody gives you something nice, what do you say?

Thanks.

That's why We know you're not lawyers. The lawyers say more, I want more, give me more. And Sally said, well, you know what? Besides being a landlord, I also made a half a million dollars from my medical practice. I had that extra mil and a half of depreciation. I used a mil of it up on the building, but I still have an extra half a million sitting around. What if I offset that loss from my building against my profits from my medical practice? Now, most accountants will say, well, wait a minute, that's Internal Revenue Code Section 469. That's passive, and you can't offset the passive loss from the rental against the money that you earn being a brain surgeon. But we say, well, wait a minute, there's an exception to 469, and that's the real estate profession. Let's assume that Sally is married to her husband Bob, and Bob is a househusband, and Bob spends his day watching Oprah and eating Bob Ball. Enjoying life. She says, Bob, it's time for you to be managing some real estate. And Bob becomes a real estate professional, and that's very easy to do. If, and on a married return, only one spouse has to qualify. So what happens is Bob is now a real estate professional, and Sally says, okay, remember that extra half a mil I had in depreciation after our the building and the cost seg. Now, because hubby, spouse, is a real estate professional, I can take what otherwise would've been disallowed passive loss, offset that against that profit of $500,000 in my medical practice. Now let's take a look at Sally. She's made $1 million profit from the business. She's made $500,000 from her brain surgery practice. She's made a profit of $1.5 million. But she's legally not paid any income taxes on this because of something simple as cost segregation analysis. And we even mentioned pensions for her. We don't have to go there.

Yeah. So we've talked a lot about cost seg on the podcast before, and I think our audience is familiar with it. But the concept of real estate professional, you know, we've alluded to it, but it, you know, for those that are maybe in real estate or around it, you know, it's easy. right? Because you're doing it. But talk about that because that's a big thing where, you know, I've talked with a lot of, you know, high W-2 income earners recently and, you know, they're kind of hearing about this real estate professional thing and how does my spouse maybe rent a couple Airbnbs out or we get a couple long-term rentals. The benefits, like you just pointed out, are pretty astronomical because if you aren't a real estate professional, You can't take the losses against your active or earned income, right? Unless you are. And then now all your income kind of gets bucketized into one bucket, so to speak. Isn't that nice? It's very nice. You know, I am a beneficiary of that and I love it. So talk about what does it mean to be a real estate professional? How do you do that if you're, you know, say you're married and your spouse, you know, is high W-2 income earner, other spouses, hey, I can maybe, I like real estate. How do I do this? What do you have to do to do that?

It's real easy. And basically what we do with our clients, we give them a checklist. And the first thing we have to watch out for in there is the real estate professional has to spend more than half of their business time in the real estate business. So that's why, for example, if Sally was single and let's assume she was spending 2,000 hours a year being brain surgeon, she'd have to spend more than 2,000 hours in the real estate activity. And that's what keeps most people out of it. That's why in my example, Bob was a househusband because now he didn't have to worry about that rule. So then we take a look, there's other rules for 500 hours and 750 hours, and also something called material participation where basically you're not doing something that's a triple net lease and you say, well, what I did was I received the rental check and I took it down to the bank. Positive. That's not enough. So what happens to be real estate professional? And the rules here, you know, real estate, the Congress got really generous. It's really pretty easy. And what happens is you can take a look at the real obvious things. You know, he's painting the wall of the apartment place, he's unstopping the sink, but you don't have to go that far. You can supervise people that are doing that. And also there's a lot else you can do. For example, you might interview tenants, see are they happy, are they going to stay. You might check along the neighborhood and say, well, wait a minute, there's another apartment house 3 miles down the street and they're brand new and they have a swimming pool and we don't, and they're only charging slightly more rent than we do. And what do we have to do to upgrade? Then hubby is now on the finance committee determining, well, wait a minute, you know, what do we have to do to go and convince the bank to lend us some money to then make these upgrades. And by the way, what upgrades should we make? Should I put that swimming pool in? So if you're in Southern California, that's fine. If you're in Northern Alaska, swimming pool might not be real attractive to your tenants, but maybe a skating rink would be. What's attractive? What else is around? Why is my building going to be more popular? And then what happens when you actually look at the list? They go on and on and they have these other categories. So again, the Congress has bent over backwards. If you, if you want to be a real estate professional, you really can just basically follow the checklist.

And just to, you know, not to belabor the point, but if this is an example, if Sally's making $500,000 and she's in, say, an effective tax bracket, you know, 40% or something, let's make it—

that calculations are easy. Yeah. 50%. If Sally lives in a state that has a tax, Right. Like California, you're over half, but you're way over half.

So you're paying $250,000 in taxes. So the marginal benefit to look at doing this and you only got to spend 750 hours in a year. I mean, it's what, about 20 hours a week? That's, you know, that's a pretty, pretty juicy benefit, right? That's pretty, pretty good pay to go and consider doing it. Yeah.

That's how I explain pension benefits to a client that's thinking about— suppose I say to a client, you know what, you would save some taxes. Let's, let's assume they're in the top bracket, fed and state. And I say, you know, I recommend you put $200,000 in the pension. $200,000? I don't want to do that. I say, no problem at all. Of the $200,000 that you're not putting away for yourself, take $100,000 of it and give it to the IRS in your state. Wait a minute, what? What do you mean give $100 to us? Well, of that $200, if you're in that top tax bracket, half of that is coming from your federal and state taxes. And then people change their mind. I have so many clients that didn't want to put away that $200 until they realized, well, wait a minute, I got to pay an extra $100 in taxes if I don't do it. And they do it. And the beauty here is with the rules, when you think about it, you have, you have basically three quarters of the way into year two. Let's assume that I met a client today, April 19th, and I said, well, look, we have almost half a year to go. You can— in your tax bracket, you could earn the money in 2023 and save an extra $100,000 on your taxes for 2022 by putting away $200,000 for yourself. No-brainer. And there's other benefits to a pension, for example, that we, that we talked about. And again, they're so important. One, you save taxes. We're focusing on that tax section. But the other thing is your earnings are not taxable. It's in that plan. So your fund grows faster and bigger. Also, because of special federal protections, if you get sued— and people love to sue business people, you know, business people are, you know, sued all the time. And what if the jury gives away an amount in excess of your insurance? What can you do? They can't touch your pension. Although I hate to mention his name, O.J. Simpson is a perfect example. O.J. has had a multimillion-dollar judgment against him for many years. He's not lost a penny of his pension. And of course, the flexibility factor where you can say, okay, this year, year 2, I can do everything and deduct it from year 1. But there's another way that works too. Suppose your client had a tremendous year. He's had an unusual year. Or he sold something, he's made an unusually large amount of taxes. I've done a good job. I made a lot of extra money this year. Yay for me. Well, I don't want to pay the extra taxes. These plans are so flexible that one of the things you can do is you can make multiple plan year contributions in one calendar year and use that to offset an unusually large amount of income. I could go on and on and on. Or it looks like—

so is a pension act similarly to like an irrevocable trust or something where you have kind of beneficiaries and trustees or because it's like a solo 401 or a 401 plan, right?

Basically what happened with most of the plans, the way you want to write them is not tie them up until you're a certain age. You want to write them so you can take it out for any reason at any time. So because that makes people nervous too, if they're young, so when I'll be stuck there. No, no, no. You write a plan, you can take the money out, and then basically if something happens, yes, you can take the money out, but right now you're getting the tax deduction. And remember, you can have multiple plans. One person can have multiple plans and make multiple contributions in the same year. So explain this.

I'm super familiar with 401s, and this is different than that.

Yes.

Oh, okay.

Is there such a thing?

Self-directed pension plans.

Our webinar, take a look at cash balance plans. It's kind of a variation of defined benefit plans.

Cash balance plans. Is there self-direction? I think you actually— and you know, one of the things I don't like about the 401s is you got to stick them in the public markets. Are these— are there other plans that have self-direction of the investment?

Some of the plans do. And then people get into investing different things like real estate and other things, precious metals. And then you start talking about, well, you know what, if I'm in this, what about an opportunity zone? How can I parlay an opportunity zone and do all the stuff we're talking about? So let's assume we say, okay, we know that 1031— you guys are very heavy into real estate. So you say, well, wait a minute, under the Tax Cuts and Jobs Act, you know, 1031s is pretty much just real estate now. And I used to be able to do that. For those of you that are watching that aren't familiar with it, this is a way that you postpone the taxes. So suppose, for example, you have Building 1, if— and then you say, you know what, I'm ready to go on to bigger and better and get Building 2. You could sell Building 1, pay the taxes, and then buy Building 2. But why pay the taxes when basically you can trade Building 1 for Building 2, not pay the taxes, push that off, which bring your basis with you. But you say, well, wait a minute, what if I had some precious metals or something else and I have a capital gain? Ah, I can't do a 1031 on those anymore. But wait a minute, if you go into an opportunity zone within 180 days, you can effectively shelter those things until 2026. And one of the beauties of an opportunity zone is that If you hold it long enough, you don't pay any capital gains taxes. Now, here's a real trick, and a lot of people don't seem to be aware of this. They say, well, wait a minute, you know, I'm a little nervous going to an opportunity zone because, you know, those properties are in a challenged neighborhood. And yeah, it's great. I don't have to pay any tax on the cap gains, but what if I lose my money? Well, you set up a company and 37% of it can be invested outside the opportunity zone. So let's assume you say, okay, what I'm going to do is I'm going to put— invest 37% in Rodeo Drive and Beverly Hills and Park Avenue in New York and some really fancy areas. Now, the real estate in the fancy areas goes through the roof. Now let's take the worst case. Your opportunity zone drops. Now a lot of them are being gentrified and they're really good investments now. But let's take— let's, let's face it, let's take a big spotlight, put it right in your face. What are you afraid of? You're going to lose your money? Bad neighborhood? Okay. Well, let's assume you do. You have the offsetting income from the fancy neighborhoods. And the bottom line is you don't pay any capital gains tax on it. So imagine—

this is crazy. So, so let me just break it down because we're not as smart as you. So You got, say, $1 million.

I did what my professional life.

You got $1 million. You're going to invest in some real estate. You go put that $1 million into a unique LLC and or I don't know if it's an LLC or just a separate company. That company then invests in multiple different deals and 37% of those deals from a— so it's the $370,000 of that company invests in Opportunity Zone. Because you're, you're doing that, the benefit of the tax savings applies to 100% of those.

You got it.

The company, holy cow.

So the bottom line is, let's assume that you invest $1 million today and 10 years from today, the fair market value of all the properties together is $100 million. You say, you know what, I think I'm going to cash out now. You sell it, you have a capital gain of $99 million. How much tax on that? Zero. Sheesh.

So, so how does that work?

Remember what I was telling you? The Congress.

Yeah.

The Congress wants people to invest money in these areas, but they can't order us to do it. So how do they get us to do it? They give us an incentive. And here what they did is 37%, they threw in a real sweetener. Okay, look, I know you really don't want to invest there, but invest there. That's awesome. 37% where you want to invest and the tax benefits on 100% of it.

Now, do you have to hold the non-Opportunity Zone properties for the full 10 years as well to get the full benefit?

That you want to do, because if you start fooling around with it, you may have other problems. So if it was my client, in almost all cases, hold on to it.

Okay.

Interesting.

Wow. Very, very cool. So, you know, what would you say? I mean, obviously the best time to be tax planning is not March 15th, right? It's to to start, start now.

The time to start tax planning is yesterday.

Yesterday.

So the bottom line is, you're watching this webinar now, you say, you know what, before I do anything else, I want to start my tax and do it kind of like a diet or exercising or working out. You've got to do it.

And I mean, Steve, if you're saying that it's possible we could pay zero taxes, that might be enough incentive to think about it more than once a year.

That's why I think about it every day.

I'm just—

maybe you understand now why I get so excited, because when I come on, when I come on somebody's show for the first time, they always think I'm, you know, doing shtick or joking around because I get so excited over taxes. But people that have known me for years, it's like when I go on the radio here in California or TV, those will say, look, I know he gets excited, but he really means this. He's really like this off air. He gets really excited about this stuff because, yeah, I'm thinking about In my example, you made a $99 million gain and you paid zero taxes on it. Come on.

It's crazy. I mean, this goes back— we talk about this all the time on the investing side of things where you need to spend time and effort thinking about your investment strategy. How do you build your wealth? And, you know, just as much or more time on that than you do how you create your wealth, right? Most of us spend most of our time in our careers, you know, doing education, degrees, spending time. But yeah. And then not only just the investments, but lots of people don't want to think about taxes, right? If you're making a lot of money, you got a bullseye on your back from the IRS. So you need to be thinking as much about your investments and growing your wealth, but also as much time about the tax planning. I mean, this is so critical because there's so many ways here, to your point, where you can defer and eliminate taxes. And it's, it's, it's— they're just sitting there waiting for you to understand them. So, uh, Steve, what are, what are some of, uh, just give us the kind of one-two punch here to kind of round out the, the interview here of— you see, give us some great, great tactics, but what are some of the biggest areas that you feel people are, are are missing, right? If they can start now, they hear this episode in a few weeks and they're saying, hey, you know what? Okay, I'm going to rip that thing off.

What do I do?

Where do I start?

Most people cheat on their tax. Oh, wait a minute. Maybe the Irishman can hear that. They cheat themselves because they don't do the tax planning. They do exactly what you were saying earlier, the March Madness. They moan and groan, they moan and cry and groan about my taxes are so much, my taxes is much. And what I say is, stop complaining about it and do something about it. And, you know, I have all kinds of clients and you don't have to be wealthy to do this. Sure, if you're wealthy, the numbers are bigger, but even if you're middle class, you can do the things that'll get you into the wealthy class. Because instead of having all those canceled checks to the IRS, the Congress says, here, you can do this. Just like we've talked about in the opportunity zones, the perfect example where the Congress can't order you to invest in a certain neighborhood, but they can sure tempt you to do it with these incentives, can't they? That's the idea. But you have to know about them. That's the whole— so basically what you need to do, like with our clients, typically we want to meet with them every month. We go over their financials and we say, look, you should be doing this, you should be doing this, you should be doing this. And this has got to become part of your routine. Just like Tim Cook at Apple, he spends a lot of time with their tax lawyers. And again, look at the money they make and the taxes they don't pay. But you have to work on this like anything else. You know, like if you're a muscle man, you have to work on it. You want to lose weight, you have to work on it. And, but the benefits here, you know, and sometimes, you know, when a client gets a little lazy, ah, you know, first of all, it's not that much work. We do most of the work. We just tell you, and basically you decide, do this. Okay. I choose A and I choose C and then choose D. And the bottom line is, just put it into numbers. Think about if somebody— if I said to you, you know what, I want you to come to my house on Christmas Eve and clean out my garage. You probably say, how dare you? What do you think you are? What if I was an eccentric billionaire and I said, I'll pay you $1 billion to do it? I bet you'd be there on Christmas Eve with your Santa cap and your shovel, now, wouldn't you? And that's what I'm saying about these tax incentives. When you realize how much money is at stake, you'll do these things. And I have a lot of clients that I've watched them start off middle class and they went into the wealthy class simply because they did these things. The combination of investments, your area of expertise, and legally saving on the taxes, my area of expertise.

Love it. Steve, what's the best way for folks to kind of learn more about your firm, what you guys do?

Either call us at 888-TAX-DEAL. That's 888-TAX-DEAL, 888-TAX-DEAL, or MoskowitzLLP.com, M-O-S-K-O-W-I-T-Z-L-L-B.com. We'd love to talk to you. And yes, I really do get this excited when I'm talking to somebody on the phone too. Love it.

I could definitely hear the radio voice coming out there. You've done this a time or two, so thanks so much, Steve, for coming on. It was really fun.